SB3215

SECTION 1. The purpose of this Act is to facilitate within the State the availability of high deductible health plans that may be purchased by members of the labor force for use with a health savings account. Maintenance of a health savings account is intended to be a required condition for a high deductible health plan. It is the intent of the legislature that health savings accounts shall be used to pay for or reimburse qualifying medical expenses and to maximize favorable tax treatment through year-to-year accumulation of contributions, which may be distributed on a tax-free basis.

This Act shall be liberally construed to allow employers and employees to receive maximum tax benefits provided in federal or state law through the use of a high deductible health plan.

SECTION 2. Chapter 431, Hawaii Revised Statutes, is amended by adding a new section to article 10A to be appropriately designated and to read as follows:

"§431:10A- High deductible health plan; limitations. (a) On or after January 1, 2025, and subject to regulation by the commissioner and the department of labor and industrial relations, an insurer may offer, sell, or renew a high deductible health plan to employers that are subject to chapter 393; provided that the insurer shall also sell the employer a prepaid health care plan group accident and health or sickness insurance policy that is not a high deductible health plan.

No package consisting of a high deductible health plan offered in conjunction with a health savings account shall be offered, sold, or renewed pursuant to this section unless the package is approved as a prepaid group health care plan pursuant to section 393-7(b).

(b) Nothing in this section shall allow an employer subject to chapter 393 to avoid providing a prepaid health care plan. It shall be a violation of this section for any insurer subject to this section to offer, sell, or renew a high deductible health plan without a health savings account, or vice versa, to an employer that is subject to chapter 393. An employer who provides a high deductible health plan in conjunction with a health savings account to a participating employee shall contribute per cent per pay period into the participating employee's health savings account maintained in conjunction with a high deductible health plan pursuant to this section.

(c) To ensure that employees are voluntarily electing, and not being inappropriately directed, to choose a high deductible health plan, each insurer that offers, sells, or renews a high deductible health plan in conjunction with a health savings account shall file with the commissioner a report containing the insurer's educational information and marketing materials regarding the health plan and health savings account that may be offered by the insurer. The insurance commissioner shall receive any complaints from employees arising under this subsection.

(d) If this section or any provision of this section conflicts at any time with any federal law, then the federal law shall prevail and this section or the relevant provisions of this section shall become ineffective and invalid. The ineffectiveness or invalidity of this section or any of its provisions shall not affect any other provisions or applications of this section, which shall be given effect without the invalid provision or application, and to this end, the provisions of this section are severable.

(e) Nothing in this section shall require an insurer to provide a health savings account to an employer or otherwise require an insurer to serve as the primary custodian or trustee of the health savings account.

(f) Nothing in this section shall be construed to affect collectively bargained agreements.

(g) As used in this section, unless the context clearly requires otherwise:

"Health savings account" means a health savings account authorized under section 223 of the Internal Revenue Code of 1986, as amended.

"High deductible health plan" shall have the same meaning as in section 223 of the Internal Revenue Code of 1986, as amended.

"Prepaid health care plan" shall have the same meaning as in section 393-3."

SECTION 3. Chapter 432, Hawaii Revised Statutes, is amended by adding a new section to article 1 to be appropriately designated and to read as follows:

"§432:1- High deductible health plan; limitations. (a) On or after January 1, 2025, and subject to regulation by the commissioner and the department of labor and industrial relations, a mutual benefit society may offer, sell, or renew a high deductible health plan contract to employers that are subject to chapter 393; provided that the mutual benefit society shall also sell the employer a prepaid health care plan group hospital and medical service plan that is not a high deductible health plan.

(b) Nothing in this section shall allow an employer subject to chapter 393 to avoid providing a prepaid health care plan. It shall be a violation of this section for any mutual benefit society subject to this section to offer, sell, or renew a high deductible health plan without a health savings account, or vice versa, to an employer that is subject to chapter 393. An employer who provides a high deductible health plan in conjunction with a health savings account to a participating employee shall contribute per cent per pay period into the participating employee's health savings account maintained in conjunction with a high deductible health plan pursuant to this section.

(c) To ensure that employees are voluntarily electing, and not being inappropriately directed, to choose a high deductible health plan, each mutual benefit society that offers, sells, or renews a high deductible health plan in conjunction with a health savings account shall file with the commissioner a report containing the mutual benefit society's educational information and marketing materials regarding the health plan and health savings account that may be offered by the mutual benefit society. The insurance commissioner shall receive any complaints from employees arising under this subsection.

(e) Nothing in this section shall require a mutual benefit society to provide the health savings account to an employer or otherwise require a mutual benefit society to serve as the primary custodian or trustee of the health savings account.

(f) Nothing in this section shall be construed to affect collectively bargained agreements.

(g) As used in this section, unless the context clearly requires otherwise:

"Health savings account" means a health savings account authorized under section 223 of the Internal Revenue Code of 1986, as amended.

"High deductible health plan" shall have the same meaning as in section 223 of the Internal Revenue Code of 1986, as amended.

"Prepaid health care plan" shall have the same meaning as in section 393-3."

SECTION 4. Chapter 432D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§432D- High deductible health plan; limitations. (a) On or after January 1, 2025, and subject to regulation by the commissioner and the department of labor and industrial relations, a health maintenance organization may offer, sell, or renew a high deductible health plan to employers that are subject to chapter 393; provided that the health maintenance organization shall also sell the employer a prepaid health care plan group contract that is not a high deductible health plan.

(b) Nothing in this section shall allow an employer subject to chapter 393 to avoid providing a prepaid health care plan. It shall be a violation of this section for any health maintenance organization subject to this section to offer, sell, or renew a high deductible health plan without a health savings account, or vice versa, to an employer that is subject to chapter 393. An employer who provides a high deductible health plan in conjunction with a health savings account to a participating employee shall contribute per cent per pay period into the participating employee's health savings account maintained in conjunction with a high deductible health plan pursuant to this section.

(c) To ensure that employees are voluntarily electing, and not being inappropriately directed, to choose a high deductible health plan, each health maintenance organization that offers, sells, or renews a high deductible health plan in conjunction with a health savings account shall file with the commissioner a report containing the health maintenance organization's educational information and marketing materials regarding the health plan and health savings account that may be offered by the health maintenance organization. The insurance commissioner shall receive any complaints from employees arising under this subsection.

(e) Nothing in this section shall require a health maintenance organization to provide a health savings account to an employer or otherwise require a health maintenance organization to serve as the primary custodian or trustee of the health savings account.

(f) Nothing in this section shall be construed to affect collectively bargained agreements.

(g) As used in this section, unless the context clearly requires otherwise:

"Health savings account" means a health savings account authorized under section 223 of the Internal Revenue Code of 1986, as amended.

"High deductible health plan" shall have the same meaning as in section 223 of the Internal Revenue Code of 1986, as amended.

"Prepaid health care plan" shall have the same meaning as in section 393-3."

SECTION 5. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 6. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2024; provided that this Act shall be repealed on June 30, 2029.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	3215
THIRTY-SECOND LEGISLATURE, 2024
STATE OF HAWAII